The non-ferrous metals sector experienced a volatile trading session today (August 6), resembling a rollercoaster ride. The Non-Ferrous Metals ETF Huabao (159876), which tracks the index with the largest scale and best liquidity*, saw its intraday price gap up 2% in early trading before paring gains, dipping below the waterline at one point. It has since recovered to a 0.41% gain, with real-time turnover exceeding 100 million yuan, indicating robust trading activity.
Against a backdrop of positive earnings forecasts and low price levels, capital is actively positioning for a rebound from oversold conditions. As of press time, the Non-Ferrous Metals ETF Huabao (159876) has recorded a net subscription of 15 million shares in real-time. This follows three consecutive days of capital inflows totaling 59.01 million yuan, and over the past ten trading days, it has accumulated a massive 176 million yuan in net subscriptions.
In terms of constituent stocks, the "indium" concept stock Yunnan Germanium Co., Ltd. has hit its daily upward limit for three consecutive sessions. Semiconductor material concept stock Youyan New Materials Co., Ltd. has achieved two consecutive limit-up moves. Gold sector leaders, including Western Gold, Shanjin International Gold, Zhongjin Gold, and Shandong Gold, are leading the gains. The heavyweight stock Zijin Mining Group is up over 1%.
On the news front, on August 5 (local time), U.S. President Donald Trump, during a speech at an event in Las Vegas, stated that recent oil prices have fallen and have stabilized to a certain extent. He added, "We might have to let it go up again," but expressed hope that scenario could be avoided. The Index Research and Investment Department of Huabao Fund pointed out that today's intraday pullback in the non-ferrous metals sector is likely attributable to Trump's fluctuating stance on oil prices. His comment that he "might have to let oil prices rise again" is significant because the shale oil industry is a key voter base and a source of campaign funding for him; his position tends to be inconsistent when oil prices are low.
However, the earlier judgment that oil prices would oscillate within a $70–120 per barrel range has been validated. This range is locked in by the short-term mutual interests of the U.S. and Iran. The ceiling on oil prices remains limited, and the pressure this places on the non-ferrous metals sector is diminishing. Huabao Fund stated that the non-ferrous metals sector currently possesses three core advantages: a tight supply-demand structure, low overall valuation, and a clear long-term demand logic driven by the technology industry. Its medium-to-long-term allocation value remains unchanged.
From a sub-sector perspective: 1) For precious metals, in the short term, global central bank gold purchases provide significant support for gold prices, and the ADP non-farm employment data came in weaker than expected. Over the medium-to-long cycle, gold trades on the second derivative of the tech sector. When the second derivative of capital expenditure in the tech sector peaks or turns negative, market expectations shift towards downstream profitability. This leads to a slowdown in computing power expansion, weaker profit expectations in the supply chain, easing inflationary pressures, and more room for the Federal Reserve to cut rates. As rate-cut expectations rise, gold benefits. At that point, the U.S. K-shaped economy—with a slowing upper leg and a factually weakening lower leg (as evidenced by ADP data)—will amplify doubts about U.S. debt and fiscal policy. The Fed may be forced to restart rate cuts, allowing the de-dollarization narrative to re-emerge as a core market pricing theme, potentially driving a medium-term trend for gold. 2) For industrial metals, the widening C-L spread caused by U.S. tariffs is leading to regional arbitrage. Supply and demand in non-U.S. regions remain tight, and downstream demand in China continues to be favorable. If U.S. copper tariffs are implemented, the domestic copper price is likely to rise to 150,000 yuan per ton between 2028 and 2030, with little chance of a significant correction. The long-term demand outlook is even more optimistic. The exponential explosion in token consumption will transmit to upstream infrastructure (power generation, transmission and distribution, data centers). Hardware deflation benefits the resources sector (lower computing hardware costs stimulate downstream token consumption, boosting infrastructure demand and increasing demand for raw non-ferrous metals). 3) For minor metals, supply-demand characteristics are notably rigid. Demand benefits from the increased hardware output in AI. Price fluctuations follow the tech beta, and combined with strategic attributes, this sector offers significant elasticity.
From a valuation perspective, the non-ferrous metals sector currently has a strong margin of safety. First, in a cross-sector comparison within the Shenwan primary industry classification, the non-ferrous metals sector's PE (TTM) is at a mid-to-low level, with significantly less valuation pressure than most other sectors. Second, historically, the PE of the CSI Non-Ferrous Metals Index is around the median of the past three years, not significantly pricing in future growth expectations. Third, comparing the domestic market to international markets, for example, Zijin Mining (A-share) has a notably lower valuation than Southern Copper Corporation (U.S.-listed), highlighting a significant global pricing discount for A-share non-ferrous metal leaders. In summary, given the strong fundamentals and low valuations of non-ferrous metals, the Index Research and Investment Department of Huabao Fund recommends focusing on the right-side allocation value of the sector.
Overall, the factors that have caused the sector to pull back since March have largely been eliminated. With commodity prices stabilizing, corporate earnings are supported. Leading companies still have production growth contributions, making sector profitability highly certain. The combination of low valuations and high growth certainty positions the current period as an excellent allocation window for the non-ferrous metals sector. [Positive earnings forecasts + Accumulating strength at low levels, a rebound from oversold conditions is on the horizon!]
Different non-ferrous metals have varying cycles, drivers, and points of peak activity, so divergence is inevitable. For those bullish on the non-ferrous metals sector, a more straightforward approach is to capture the broader beta by holding a comprehensive portfolio. The underlying index of Non-Ferrous Metals ETF Huabao (159876) and its linked funds (Class A: 017140, Class C: 017141) fully covers industries including copper, aluminum, rare earths, gold, lithium, tungsten, molybdenum, and tin. This full-category coverage allows for better capture of the sector's beta. Furthermore, this ETF is a margin trading and short selling target, serving as an efficient tool for one-click investment in the non-ferrous metals sector. As of August 5, the Non-Ferrous Metals ETF Huabao (159876) has a latest scale of 1.642 billion yuan and an average daily turnover of 104 million yuan year-to-date, making it the largest and most liquid ETF among the three tracking the CSI Non-Ferrous Metals Index on the market. Source: Shanghai and Shenzhen stock exchanges, as of August 6, 2026. Fee Explanation: When investors subscribe for or redeem fund shares, the subscription and redemption agency may charge a commission of up to 0.5%. On-exchange trading fees are subject to the actual charges of the securities company. The ETF does not charge a sales service fee. Risk Warning: The Non-Ferrous Metals ETF Huabao passively tracks the CSI Non-Ferrous Metals Index. The index's base date is December 31, 2013, and it was published on July 13, 2015. The composition of the index's constituent stocks is adjusted periodically according to the index's compilation rules. Its back-tested historical performance is not indicative of the index's future performance. The constituent stocks displayed in this article are for illustrative purposes only. Descriptions of individual stocks do not constitute investment advice of any kind and do not represent the holdings or trading activities of any fund managed by the fund manager. The fund manager has assessed the risk level of this fund as R3-medium risk, suitable for balanced (C3) and above investors. The appropriate risk matching opinion should be based on the sales institution's advice. Any information appearing in this article (including but not limited to individual stocks, commentary, forecasts, charts, indicators, theories, any form of expression, etc.) is for reference only. Investors are solely responsible for their own investment decisions. Furthermore, any views, analyses, or forecasts in this article do not constitute investment advice of any kind to the reader and shall not be liable for any direct or indirect losses arising from the use of this content. Fund investment carries risks. Past performance of a fund is not indicative of its future performance. The performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. Invest in funds with caution. MACD golden cross signal formed, these stocks are showing strong upward momentum!
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